Islamabad: In a sweeping policy shift, the National Electric Power Regulatory Authority (Nepra) on Monday overhauled the regulatory framework governing net-metered solar consumers, known as prosumers, by terminating the net-metering regime and replacing it with net-billing for all existing and future consumers.
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The changes were notified through new regulations that had earlier been circulated as a draft for public feedback. However, despite a public hearing, the authority implemented the regulations without altering a single provision, effectively finalising a predetermined policy decision aimed at curbing the rapid growth of solar energy and protecting the state-owned power distribution system.
Contrary to earlier assurances by government officials that existing prosumers would continue under their original seven-year net-metering contracts, Nepra has ruled that all registered prosumers will be shifted immediately to net-billing. While their seven-year contracts will remain valid until expiry, exported electricity units will now be credited for only one month instead of the previous three-month adjustment period.
Under the new framework, future prosumers will be offered contracts limited to five years. The buyback rate for electricity exported to distribution companies (Discos) by new prosumers has been slashed to around Rs10–11 per unit, down from Rs26 per unit under the previous net-metering policy. Existing prosumers will continue to receive Rs26 per unit for exported electricity until their contracts expire.
Electricity imported from Discos will now be billed separately at rates ranging between Rs37 and Rs55 per unit, excluding taxes, duties, and surcharges. Unlike the previous unit-for-unit adjustment system, export and import units will be calculated independently, and consumers will be billed for the net difference.
Nepra held an extended public hearing last Friday but restricted stakeholders, including consumers, independent analysts, and business representatives, from proposing alternative policy options. By the next working day, the authority notified the draft regulations unchanged.
The Power Division and Nepra have attributed rising grid inefficiencies and capacity charges to prosumers exceeding approved solar capacities and the widespread use of non-metered solar systems. However, the new regulations apply only to metered solar consumers, leaving off-grid and hybrid system users largely unaddressed.
According to official figures, on-grid solar capacity has reached 7,000 megawatts, while off-grid installations exceed 13,000 megawatts. The power minister has claimed that total unmetered solar capacity may exceed 19,000 megawatts, driven by consumers attempting to remain within subsidised tariff slabs.
Under the net-billing regime, Discos will bill prosumers for electricity consumed at applicable tariffs, while purchasing surplus solar generation at the National Average Energy Purchase Price (NAEPP), currently around Rs10 per unit. Any excess credit in favour of the prosumer may be adjusted in subsequent billing cycles or paid quarterly, although such payments have historically been delayed.
The regulations also prohibit prosumers from installing solar capacity beyond their sanctioned load, effectively reducing allowable capacity by up to 50 per cent. Additionally, Discos may reject new applications if distributed generation connected to a transformer reaches 80 per cent of its rated capacity, citing technical stability concerns.
The new rules apply to distributed generation systems ranging from 1kW to 1MW under Nepra’s jurisdiction. Consumers below 25kW remain licensed directly by Discos.
Despite the policy shift, Nepra has previously acknowledged that high electricity prices, heavy taxation, and inefficiencies within power companies have driven consumers toward decentralised energy solutions. The regulator maintains that the revised framework introduces clearer procedures and stricter technical standards to better integrate rooftop solar into the national grid while maintaining system stability.
